The concept of electronic commerce has become more and more popular as new technologies and the increasing availability of computers and other communication technologies. The use of electronics in business transactions had existed long before the coming of the internet. An example would be the fund transfer of the old days where customers can receive money through banks by means of a telegram. But the internet has only served to popularise the concept even more due to its technical capability and its user-friendliness. This has also resulted in many models of ecommerce that have been developed over the years by innovative companies and individuals. There are many benefits and advantages in using ecommerce in business. The benefits accrue to other businesses, individual customers, and even employees of an organisation. This paper is an attempt to how ecommerce can improve certain aspects of business like reduction in cycle time, increase employee empowerment, and improvement in customer support.
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Definition of ecommerce: Before moving on the topic of the paper, it would be worthwhile to define the concept of ecommerce. There are many perceptions of what constitutes ecommerce and hence only a broad definition is possible in this context. “At its broadest, electronic commerce involves conducting business using most modern communication instruments: telephone, fax, television, electronic payment, and money transfer systems, Electronic Data Interchange, and the Internet.” (Mitchell 2001, p.685).
Reducing cycle time
An ecommerce transaction has the capability to reduce cycle time and thereby bring cost advantages to all the parties involved in a transaction. “Cycle time is the total time from the beginning to the end of your process, as defined by you and your customer.” (Cycle Time. 2009). Since communication is near instantaneous an order can be processed quickly. In earlier times an order would have to be sent by post. Moreover technology has developed to a point where an order can directly be received by the despatching section for quick response. Intranets within a business will also help in inter-departmental communication so that the dispatcher can contact manufacturer or spares departments for making the item available. An ideal example would be the Dell Computers website in Hong Kong. A customer can visit the site, customize a system, get its price and place an order in one single go. In traditional settings, a customer would have to visit many dealers, find out about different models, find the right model, and purchase it. This might take a few days during which a person cannot do anything else in the process. But in the former case, the whole process can take only a few hours after which the person can resume his normal routines. The system will be delivered to the house the next day if possible. (Software and Peripherals Estimated Ship Date). In the case of software, audio, and video, the transaction is instantaneous and can commence once online payment is made
Even though the number of employees can be reduced in case of ecommerce, certain developments over the years have led to a situation of employee empowerment. With the help of electronic guidelines and decision aids, they are enabled to take decisions on their own, which otherwise would have needed the approval of the superior. This can save the time of a transaction be eliminating the delay in waiting for the superior’s response. This is beneficial for the business and employees as well, because empowering employees by giving them more responsibilities can result in improved performance. Dell can be given as an example here also. In traditional transactions, an employee will have no problem to authorising a sale if the model is a readymade one. But in case it is customised, he might have to check with his superiors in finalising a price. But here, the employee is guided by parameters that will automatically fix the price, discount, warranty, and other offers and hence he can authorise the sale without referring to his superiors. The employee is empowered to make a sale here.
Facilitating customer support
There are many ways in which customer support is increased or facilitated in e-commerce. Most sites have a section called frequently asked questions (FAQ) where the customer can clear his most of his doubts without talking to an employee. Only if his doubts are not cleared will he have to resort this option. He can also post a query which will usually be answered via email. It is easy to identify loyal customers who purchase frequently some product or service from the same company since all data can be electronically verified. An example would be the benefits to frequent flyers by Cathay Pacific though it’s Marco Polo Club. For example, Gold level members are provided with guaranteed economy whenever they want to fly. They also have 24 hour dedicated lines for online seat reservation. (Club Benefits). Registering complaints online, posting suggestions and tracking the order online are some of the other customer support options available.
Club Benefits. Cathay Pacific. Web.
Cycle Time. (2009). Six Sigma. Web.
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MITCHELL, Andrew D. (2001). Electronic Commerce and The WTO. Journal of International Economic Law, 4 (4), P.685. Web.
Software and Peripherals Estimated Ship Date. Dell. Web.